Free Cash Flow was $304 million; Returned $267 million to shareholders through share repurchases and dividends

Board of Directors recommended raising the annual dividend to $1 per share; Shareholders will vote on the recommendation in March 2013

Recognized as a Top 100 Global Innovator by Thomson Reuters for the second consecutive year

"First quarter results were in line with our expectations as strong margin performance offset slightly weaker than expected sales particularly in our Networks segment," said TE Connectivity Chairman and Chief Executive Officer Tom Lynch. "Orders strengthened through the quarter in most of our businesses primarily due to improved economic conditions in the United States and China. Our book to bill for the quarter was 1.02 excluding our SubCom business. We also had another good free cash flow quarter, generating $304 million and returning the majority back to our shareholders."

"I'm encouraged by our order trends and significant productivity improvements. As a result, we expect sales and adjusted earnings to increase in the second quarter and to deliver a strong second half. For the full year, we anticipate returning over $1 billion to shareholders."

FISCAL FIRST QUARTER RESULTSThe company reported net sales of $3.13 billion compared to prior year sales of $3.17 billion. Adjusted EPS were $0.65, compared to $0.63 in the prior year. GAAP EPS were $0.65 for the quarter. Free cash flow was $304 million for the quarter.

GAAP EPS included $0.01 per share of acquisition-related charges, $0.15 per share of restructuring and other charges, and $0.16 of income related to tax items.

Company orders, excluding the Subsea Communications business, were $3.08 billion in the first quarter and the book-to-bill ratio was 1.02.

OUTLOOKFor the second quarter, the company expects net sales of $3.2 to $3.3 billion and adjusted EPS of $0.68 to $0.72. GAAP EPS are expected to be $0.50 to $0.54, including restructuring and acquisition-related charges of $0.18.

For the full year, the company expects net sales of $13.3 to $13.7 billion and adjusted EPS of $3.05 to $3.25. GAAP EPS are expected to be $2.79 to $2.99, including restructuring and acquisition-related charges of $0.42 and income from tax-related items of $0.16.

This outlook assumes foreign exchange rates and commodity prices that are consistent with current levels.

Information about TE Connectivity's use of non-GAAP financial measures is described at the end of this press release. For a reconciliation of these non-GAAP financial measures, see the attached tables.

ABOUT TE CONNECTIVITYTE Connectivity (NYSE: TEL) is a $13 billion world leader in connectivity. The company designs and manufactures products at the heart of electronic connections for the world's leading industries including automotive, energy and industrial, broadband communications, consumer devices, healthcare, and aerospace and defense. TE Connectivity's long-standing commitment to innovation and engineering excellence helps its customers solve the need for more energy efficiency, always-on communications and ever-increasing productivity. With nearly 90,000 employees in over 50 countries, TE Connectivity makes connections the world relies on to work flawlessly every day. To connect with the company, visit: www.TE.com.

CONFERENCE CALL AND WEBCAST

The company will hold a conference call for investors today beginning at 8:30 a.m. EST.

Internet users will be able to access the company's earnings webcast, including slide materials, at the "Investors" section of TE Connectivity's website: http://investors.te.com.

For both "listen-only" participants and those participants who wish to take part in the question-and-answer portion of the call, the telephone dial-in number in the United States is (800) 288-8967. The telephone dial-in number for participants outside the United States is (612) 332-0107.

An audio replay of the conference call will be available beginning at 10:30 a.m. on January 23, 2013 and ending at 11:59 p.m. on January 30, 2013. The dial-in number for participants in the United States is (800) 475-6701. For participants outside the United States, the replay dial-in number is (320) 365-3844. The replay access code for all callers is 278371.

NON-GAAP MEASURES

"Organic Sales Growth," "Adjusted Operating Income," "Adjusted Operating Margin," "Adjusted Other Income, Net," "Adjusted Income Tax Expense," "Adjusted Income from Continuing Operations," "Adjusted Earnings Per Share," and "Free Cash Flow" (FCF) are non-GAAP measures and should not be considered replacements for GAAP results.

"Organic Sales Growth" is a useful measure used by us to measure the underlying results and trends in the business. The difference between reported net sales growth (the most comparable GAAP measure) and Organic Sales Growth (the non-GAAP measure) consists of the impact from foreign currency exchange rates and acquisitions and divestitures, if any. Organic Sales Growth is a useful measure of our performance because it excludes items that: i) are not completely under management's control, such as the impact of changes in foreign currency exchange rates; or ii) do not reflect the underlying growth of the company, such as acquisition and divestiture activity. The limitation of this measure is that it excludes items that have an impact on our sales. This limitation is best addressed by using organic sales growth in combination with the GAAP results.

We present operating income before special items including charges or income related to legal settlements and reserves, restructuring and other charges, acquisition related charges, impairment charges, and other income or charges, if any ("Adjusted Operating Income"). We utilize Adjusted Operating Income to assess segment level core operating performance and to provide insight to management in evaluating segment operating plan execution and underlying market conditions. It also is a significant component in our incentive compensation plans. Adjusted Operating Income is a useful measure for investors because it provides insight into our underlying operating results, trends, and the comparability of these results between periods. The difference between Adjusted Operating Income and operating income (the most comparable GAAP measure) consists of the impact of charges or income related to legal settlements and reserves, restructuring and other charges, acquisition related charges, impairment charges, and other income or charges, if any, that may mask the underlying operating results and/or business trends. The limitation of this measure is that it excludes the financial impact of items that would otherwise either increase or decrease our reported operating income. This limitation is best addressed by using Adjusted Operating Income in combination with operating income (the most comparable GAAP measure) in order to better understand the amounts, character and impact of any increase or decrease on reported results.

We present operating margin before special items including charges or income related to legal settlements and reserves, restructuring and other charges, acquisition related charges, impairment charges, and other income or charges, if any ("Adjusted Operating Margin"). We present Adjusted Operating Margin before special items to give investors a perspective on the underlying business results. It also is a significant component in our incentive compensation plans. This measure should be considered in conjunction with operating margin calculated using our GAAP results in order to understand the amounts, character and impact of adjustments to operating margin.

We present other income, net before special items including tax sharing income related to certain proposed adjustments to prior period tax returns and other tax items, if any ("Adjusted Other Income, Net"). We present Adjusted Other Income, Net as we believe that it is appropriate for investors to consider results excluding these items in addition to results in accordance with GAAP. The difference between Adjusted Other Income, Net and other income, net (the most comparable GAAP measure) consists of tax sharing income related to certain proposed adjustments to prior period tax returns and other tax items, if any. The limitation of this measure is that it excludes the financial impact of items that would otherwise either increase or decrease other income, net. This limitation is best addressed by using Adjusted Other Income, Net in combination with other income, net (the most comparable GAAP measure) in order to better understand the amounts, character and impact of any increase or decrease in reported amounts.

We present income tax expense after adjusting for the tax effect of special items including charges related to restructuring and other charges, acquisition related charges, impairment charges, other income or charges, and certain significant special tax items, if any ("Adjusted Income Tax Expense"). We present Adjusted Income Tax Expense to provide investors further information regarding the tax effects of adjustments used in determining the non-GAAP financial measure Adjusted Income from Continuing Operations (as defined below). The difference between Adjusted Income Tax Expense and income tax expense (the most comparable GAAP measure) is the tax effect of adjusting items and certain significant special tax items, if any. The limitation of this measure is that it excludes the financial impact of items that would otherwise either increase or decrease income tax expense. This limitation is best addressed by using Adjusted Income Tax Expense in combination with income tax expense (the most comparable GAAP measure) in order to better understand the amounts, character and impact of any increase or decrease in reported amounts.

We present income from continuing operations attributable to TE Connectivity Ltd. before special items including charges or income related to legal settlements and reserves, restructuring and other charges, acquisition related charges, impairment charges, tax sharing income related to certain proposed adjustments to prior period tax returns and other tax items, certain significant special tax items, other income or charges, if any, and, if applicable, related tax effects ("Adjusted Income from Continuing Operations"). We present Adjusted Income from Continuing Operations as we believe that it is appropriate for investors to consider results excluding these items in addition to results in accordance with GAAP. Adjusted Income from Continuing Operations provides additional information regarding our underlying operating results, trends and the comparability of these results between periods. The difference between Adjusted Income from Continuing Operations and income from continuing operations attributable to TE Connectivity Ltd. (the most comparable GAAP measure) consists of the impact of charges or income related to legal settlements and reserves, restructuring and other charges, acquisition related charges, impairment charges, tax sharing income related to certain proposed adjustments to prior period tax returns and other tax items, certain significant special tax items, other income or charges, if any, and, if applicable, related tax effects. The limitation of this measure is that it excludes the financial impact of items that would otherwise either increase or decrease our reported results. This limitation is best addressed by using Adjusted Income from Continuing Operations in combination with income from continuing operations attributable to TE Connectivity Ltd. (the most comparable GAAP measure) in order to better understand the amounts, character and impact of any increase or decrease in reported amounts.

We present diluted earnings per share from continuing operations attributable to TE Connectivity Ltd. before special items, including charges or income related to legal settlements and reserves, restructuring and other charges, acquisition related charges, impairment charges, tax sharing income related to certain proposed adjustments to prior period tax returns and other tax items, certain significant special tax items, other income or charges, if any, and, if applicable, related tax effects ("Adjusted Earnings Per Share"). We present Adjusted Earnings Per Share because we believe that it is appropriate for investors to consider results excluding these items in addition to results in accordance with GAAP. We believe such a measure provides a picture of our results that is more comparable among periods since it excludes the impact of special items, which may recur, but tend to be irregular as to timing, thereby making comparisons between periods more difficult. It also is a significant component in our incentive compensation plans. The limitation of this measure is that it excludes the financial impact of items that would otherwise either increase or decrease our reported results. This limitation is best addressed by using Adjusted Earnings Per Share in combination with diluted earnings per share from continuing operations attributable to TE Connectivity Ltd. (the most comparable GAAP measure) in order to better understand the amounts, character and impact of any increase or decrease on reported results.

"Free Cash Flow" (FCF) is a useful measure of our performance and ability to generate cash. It also is a significant component in our incentive compensation plans. The difference between net cash provided by continuing operating activities (the most comparable GAAP measure) and FCF (the non-GAAP measure) consists mainly of significant cash outflows and inflows that we believe are useful to identify. We believe free cash flow provides useful information to investors as it provides insight into the primary cash flow metric used by management to monitor and evaluate cash flows generated from our operations. The difference reflects the impact from net capital expenditures, voluntary pension contributions, and special items, if any.

Net capital expenditures are subtracted because they represent long-term commitments. Voluntary pension contributions are subtracted from the GAAP measure because this activity is driven by economic financing decisions rather than operating activity. Certain special items, including net payments related to pre-separation tax matters, also are considered by management in evaluating free cash flow. We believe investors should consider these items in evaluating our free cash flow. We forecast our cash flow results excluding any voluntary pension contributions because we have not yet made a determination about the amount and timing of any such future contributions. In addition, our forecast excludes the cash impact of special items because we cannot predict the amount and timing of such items.

FCF as presented herein may not be comparable to similarly-titled measures reported by other companies. The primary limitation of this measure is that it excludes items that have an impact on our GAAP cash flow. Also, it subtracts certain cash items that are ultimately within management's and the Board of Directors' discretion to direct and may imply that there is less or more cash available for our programs than the most comparable GAAP measure indicates. This limitation is best addressed by using FCF in combination with the GAAP cash flow results. It should not be inferred that the entire free cash flow amount is available for future discretionary expenditures, as our definition of free cash flow does not consider certain non-discretionary expenditures, such as debt payments. In addition, we may have other discretionary expenditures, such as discretionary dividends, share repurchases, and business acquisitions that are not considered in the calculation of free cash flow.

Because we do not predict the amount and timing of special items that might occur in the future, and our forecasts are developed at a level of detail different than that used to prepare GAAP-based financial measures, we do not provide reconciliations to GAAP of our forward-looking financial measures.

FORWARD-LOOKING STATEMENTS

This release contains certain "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and are subject to risks, uncertainty and changes in circumstances, which may cause actual results, performance, financial condition or achievements to differ materially from anticipated results, performance, financial condition or achievements. All statements contained herein that are not clearly historical in nature are forward-looking and the words "anticipate," "believe," "expect," "estimate," "plan," and similar expressions are generally intended to identify forward-looking statements. We have no intention and are under no obligation to update or alter (and expressly disclaim any such intention or obligation to do so) our forward-looking statements whether as a result of new information, future events or otherwise, except to the extent required by law. The forward-looking statements in this release include statements addressing our future financial condition and operating results. Examples of factors that could cause actual results to differ materially from those described in the forward-looking statements include, among others, business, economic, competitive and regulatory risks, such as conditions affecting demand for products, particularly in the automotive industry and the telecommunications, computer and consumer electronics industries; competition and pricing pressure; fluctuations in foreign currency exchange rates and commodity prices; natural disasters and political, economic and military instability in countries in which we operate; developments in the credit markets; future goodwill impairment; compliance with current and future environmental and other laws and regulations; the possible effects on us of changes in tax laws, tax treaties and other legislation; the risk that Deutsch's operations will not be successfully integrated into ours; and the risk that revenue opportunities, cost savings and other anticipated synergies from the Deutsch acquisition may not be fully realized or may take longer to realize than expected. More detailed information about these and other factors is set forth in TE Connectivity Ltd.'s Annual Report on Form 10-K for the fiscal year ended Sept. 28, 2012 as well as in our Current Reports on Form 8-K and other reports filed by us with the U.S. Securities and Exchange Commission.

TE CONNECTIVITY LTD.

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

For the Quarters Ended

December 28,

December 30,

2012

2011

(in millions, except per share data)

Net sales

$ 3,134

$ 3,170

Cost of sales

2,145

2,227

Gross margin

989

943

Selling, general, and administrative expenses

428

383

Research, development, and engineering expenses

171

177

Acquisition and integration costs

5

4

Restructuring and other charges, net

92

18

Operating income

293

361

Interest income

4

5

Interest expense

(37)

(39)

Other income (expense), net

(226)

1

Income from continuing operations before income taxes

34

328

Income tax (expense) benefit

245

(88)

Income from continuing operations

279

240

Income (loss) from discontinued operations, net of income taxes

(2)

22

Net income

277

262

Less: net income attributable to noncontrolling interests

-

(2)

Net income attributable to TE Connectivity Ltd.

$ 277

$ 260

Amounts attributable to TE Connectivity Ltd.:

Income from continuing operations

$ 279

$ 238

Income (loss) from discontinued operations

(2)

22

Net income

$ 277

$ 260

Basic earnings per share attributable to TE Connectivity Ltd.:

Income from continuing operations

$ 0.66

$ 0.56

Income from discontinued operations

-

0.05

Net income

$ 0.66

$ 0.61

Diluted earnings per share attributable to TE Connectivity Ltd.:

Income from continuing operations

$ 0.65

$ 0.55

Income from discontinued operations

-

0.06

Net income

$ 0.65

$ 0.61

Dividends and cash distributions paid per common share of TE Connectivity Ltd.

$ 0.21

$ 0.18

Weighted-average number of shares outstanding:

Basic

422

425

Diluted

426

429

TE CONNECTIVITY LTD.

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

December 28,

September 28,

2012

2012

(in millions, except share data)

Assets

Current Assets:

Cash and cash equivalents

$ 972

$ 1,589

Accounts receivable, net of allowance for doubtful accounts of $45 and $41, respectively

Adjustments to reconcile income from continuing operations to net cash provided by operating activities:

Tax sharing (income) expense

226

(2)

Depreciation and amortization

152

141

Deferred income taxes

121

49

Provision for losses on accounts receivable and inventories

25

27

Share-based compensation expense

21

17

Other

20

(7)

Changes in assets and liabilities, net of the effects of acquisitions and divestitures:

Accounts receivable, net

123

98

Inventories

(44)

(82)

Inventoried costs on long-term contracts

16

(4)

Prepaid expenses and other current assets

11

21

Accounts payable

(38)

(51)

Accrued and other current liabilities

(76)

(204)

Income taxes

(451)

(13)

Deferred revenue

(9)

(46)

Long-term pension and postretirement liabilities

9

7

Other

8

4

Net cash provided by continuing operating activities

393

195

Net cash provided by (used in) discontinued operating activities

(1)

12

Net cash provided by operating activities

392

207

Cash Flows From Investing Activities:

Capital expenditures

(126)

(130)

Proceeds from sale of property, plant, and equipment

2

5

Other

19

(1)

Net cash used in investing activities

(105)

(126)

Cash Flows From Financing Activities:

Net increase in commercial paper

50

179

Repayment of long-term debt

(714)

-

Proceeds from exercise of share options

16

12

Repurchase of common shares

(167)

(17)

Payment of common share dividends and cash distributions to shareholders

(89)

(77)

Other

(2)

8

Net cash provided by (used in) continuing financing activities

(906)

105

Net cash provided by (used in) discontinued financing activities

1

(12)

Net cash provided by (used in) financing activities

(905)

93

Effect of currency translation on cash

1

(3)

Net increase (decrease) in cash and cash equivalents

(617)

171

Cash and cash equivalents at beginning of period

1,589

1,218

Cash and cash equivalents at end of period

$ 972

$ 1,389

Supplemental Cash Flow Information:

Interest paid

$ 65

$ 63

Income taxes paid, net of refunds

84

53

Reconciliation to Free Cash Flow:

Net cash provided by continuing operating activities

393

195

Capital expenditures, net

(124)

(125)

Payments related to pre-separation tax matters, net

35

9

Free cash flow(1)

$ 304

$ 79

(1) Free cash flow is a non-GAAP measure. See description of non-GAAP measures contained in this release.

TE CONNECTIVITY LTD.

CONSOLIDATED SEGMENT DATA (UNAUDITED)

For the Quarters Ended

December 28,

December 30,

2012

2011

($ in millions)

Net Sales:

Transportation Solutions

$ 1,264

$ 1,231

Network Solutions

734

802

Industrial Solutions

700

685

Consumer Solutions

436

452

Total

$ 3,134

$ 3,170

Operating Income (Loss):

Transportation Solutions

$ 192

15.2%

$ 184

14.9%

Network Solutions

36

4.9%

59

7.4%

Industrial Solutions

70

10.0%

90

13.1%

Consumer Solutions

(5)

NM(1)

28

6.2%

Total

$ 293

9.3%

$ 361

11.4%

(1) Not meaningful.

TE CONNECTIVITY LTD.

NET SALES GROWTH RECONCILIATION (UNAUDITED)

Percentage of

Change in Net Sales for the Quarter Ended December 28, 2012

Segment's Total

versus Net Sales for the Quarter Ended December 30, 2011

Net Sales for the

Organic (1)

Translation(2)

Acquisition

Total

Quarter

Ended

December 28, 2012

($ in millions)

Transportation Solutions(3):

Automotive

$ (12)

(1.0)

%

$ (25)

$ 70

$33

2.7

%

100

%

Total

(12)

(1.0)

(25)

70

33

2.7

100

%

Network Solutions (3):

Telecom Networks

(17)

(5.6)

(3)

-

(20)

(6.6)

38

Data Communications

(10)

(4.6)

(1)

-

(11)

(5.2)

27

Enterprise Networks

(13)

(7.7)

(1)

-

(14)

(8.8)

20

Subsea Communications

(23)

(17.6)

-

-

(23)

(17.6)

15

Total

(63)

(7.8)

(5)

-

(68)

(8.5)

100

%

Industrial Solutions (3):

Industrial

(43)

(13.4)

(4)

-

(47)

(14.8)

38

Aerospace, Defense, and Marine

(5)

(3.0)

(1)

78

72

42.1

35

Energy

(7)

(3.3)

(3)

-

(10)

(5.1)

27

Total

(55)

(8.0)

(8)

78

15

2.2

100

%

Consumer Solutions (3):

Consumer Devices

(4)

(1.4)

(3)

-

(7)

(2.5)

63

Appliances

(7)

(4.0)

(2)

-

(9)

(5.3)

37

Total

(11)

(2.4)

(5)

-

(16)

(3.5)

100

%

Total

$ (141)

(4.4)

%

$ (43)

$ 148

$ (36)

(1.1)

%

(1) Represents the change in net sales resulting from volume and price changes, before consideration of acquisitions, divestitures, and the impact of changes in foreign currency exchange rates. Organic net sales growth is a non-GAAP measure. See description of non-GAAP measures contained in this release.

(3) Industry end market information is presented consistently with our internal management reporting and may be periodically revised as management deems necessary.

TE CONNECTIVITY LTD.

NET SALES GROWTH RECONCILIATION (UNAUDITED)

Percentage of

Change in Net Sales for the Quarter Ended December 28, 2012

Segment's Total

versus Net Sales for the Quarter Ended September 28, 2012

Net Sales for the

Organic (1)

Translation(2)

Total

Quarter

Ended

December 28, 2012

($ in millions)

Transportation Solutions(3):

Automotive

$ (35)

(2.7)

%

$ 20

$ (15)

(1.2)

%

100

%

Total

(35)

(2.7)

20

(15)

(1.2)

100

%

Network Solutions (3):

Telecom Networks

(63)

(18.6)

2

(61)

(17.8)

38

Data Communications

(26)

(11.6)

1

(25)

(11.2)

27

Enterprise Networks

(18)

(11.0)

2

(16)

(9.9)

20

Subsea Communications

(3)

(2.7)

1

(2)

(1.8)

15

Total

(110)

(13.1)

6

(104)

(12.4)

100

%

Industrial Solutions (3):

Industrial

(39)

(12.9)

2

(37)

(12.1)

38

Aerospace, Defense, and Marine

(17)

(6.6)

3

(14)

(5.4)

35

Energy

(29)

(13.7)

3

(26)

(12.2)

27

Total

(85)

(11.0)

8

(77)

(9.9)

100

%

Consumer Solutions (3):

Consumer Devices

(20)

(6.7)

(1)

(21)

(7.1)

63

Appliances

(14)

(8.3)

1

(13)

(7.4)

37

Total

(34)

(7.3)

-

(34)

(7.2)

100

%

Total

$(264)

(7.9)

%

$ 34

$(230)

(6.8)

%

(1) Represents the change in net sales resulting from volume and price changes, before consideration of acquisitions, divestitures, and the impact of changes in foreign currency exchange rates. Organic net sales growth is a non-GAAP measure. See description of non-GAAP measures contained in this release.